Services growth slows abruptly in January, PMI shows
The country’s services sector grew at its slowest pace in nine months in January as new export business contracted for the first time in six months and employment fell marginally, a survey showed today.
The AIB Global S&P Purchasing Managers’ Index (PMI) fell to 53.4 in January from 57.1 in December, slipping below the long-run trend level of 55.1.
New business rose at its slowest pace since September 2024 and new export business was the weakest since last August, AIB said in a statement.
The index did, however, remain above the 50 level that signals growth and was stronger than similar surveys from the euro zone and UK.
The January expansion was driven by an increase in new and outstanding business, while the future activity index rose to its highest level since February 2024, AIB said.
AIB said that all four sub-sectors registered varying paces of expansion last month.
Transport, Tourism & Leisure registered the fastest growth once again, having been a laggard throughout much of 2024, with more modest gains in Technology, Media & Telecoms, Business Services, and Financial Services.
It noted that hiring activity was mixed across the sectors, with a contraction in the Financial Services sector, and weak growth in the remaining three sectors.
“On the inflation front, the input cost index was higher once again, implying continued rising cost pressures in the sector,” AIB’s chief economist David McNamara said.
“Wages and utilities were cited as key drivers of higher costs. The rate of increase in prices charged also accelerated, as firms protected margins, despite a softer demand environment,” he said.
“In terms of the outlook, firms remain optimistic for business activity in 2025. The future activity index rose to its highest level since February 2024, linked to new projects and business
opportunities domestically and abroad,” he added.
Article Source – Services growth slows abruptly in January, PMI shows – RTE
